Revenue Ruling 2004-70

Rev. Rul. 2004-70
Rev. Rul. 2004-70, 2004-37 I.R.B. 460
                       Internal Revenue Service (I.R.S.)
                                 Revenue Ruling
                   FRINGE BENEFITS AIRCRAFT VALUATION FORMULA
                          Published: September 13, 2004

 Section 61.–Gross Income Defined, 26 CFR 1.61-21: Taxation of fringe benefits.

  Fringe benefits aircraft valuation formula. The Standard Industry Fare Level  (SIFL) cents-per-mile rates and terminal charges in effect for the second half of 2004 are set forth for purposes of determining the value of noncommercial flights on employer-provided aircraft under section 1.61-21(g) of the regulations.

  Fringe benefits aircraft valuation formula. The Standard Industry Fare Level  (SIFL) cents-per-mile rates and terminal charges in effect for the second half of 2004 are set forth for purposes of determining the value of noncommercial flights on employer-provided aircraft under section 1.61-21(g) of the regulations.

  For purposes of the taxation of fringe benefits under section 61 of the Internal Revenue Code, section 1.61-21(g) of the Income Tax Regulations provides a rule for valuing noncommercial flights on employer-provided aircraft. Section 1.61-21(g)(5) provides an aircraft valuation formula to determine the value of such flights. The value of a flight is determined under the base aircraft valuation formula (also known as the Standard Industry Fare Level formula or SIFL) by multiplying the SIFL cents-per-mile rates applicable for the period during which the flight was taken by the appropriate aircraft multiple provided in section 1.61-21(g)(7) and then adding the applicable terminal charge. The SIFL cents-per-mile rates in the formula and the terminal charge are calculated by the Department of Transportation and are reviewed semi-annually.

  The following chart sets forth the terminal charges and SIFL mileage rates:

——————————————————————————-
Period During Which the        Terminal       SIFL Mileage Rates
  Flight Is Taken                Charge
7/1/04 - 12/31/04              $35.21         Up to 500 miles = $.1926 per mile
                                              501-1500 miles = $.1469 per mile
                                              Over 1500 miles = $.1412 per mile
——————————————————————————-

DRAFTING INFORMATION

  The principal author of this revenue ruling is Kathleen Edmondson of the Office of Division Counsel/Associate Chief Counsel (Tax Exempt and Government Entities). For further information regarding this revenue ruling, contact Ms. Edmondson at (202) 622-6040 (not a toll-free call).

 Rev. Rul. 2004-70, 2004-37 I.R.B. 460

Bookmark to:

September 3rd, 2004 |